Power sale to Singapore unlikely, says OSK

OSK Research said it is unlikely that any party would be selling power
to Singapore until gas and electricity subsidies are completely removed.

The research house said Petronas has baulked at having to carry on with gas subsidies while TNB has clamoured for more gas.

It
said there has been speculation that the electricity sale might involve
laying a new submarine cable from Sarawak's dams to Singapore given the
excess electricity.

"However, this too would take some time given the construction lead time required," it said in a note today.

"As
such, unless Malaysians suddenly feel very generous and wish to sell
subsidised electricity to Singapore, we believe that it is unlikely that
the sale of electricity to the republic would materialise anytime
soon," it said.

OSK Research has maintained its 'neutral' call
on the utility sector with 'top buy' being Petronas Gas at RM15.95 while
remaining neutral on Tenaga Nasional at RM6.36.

The research
house, however, maintained its trading 'buy' call at RM3.65 on MMC Corp,
mainly on the potential listing of its subsidiaries as well as merger
and accquisition news.

During the Malaysia-Singapore Leaders'
Retreat last week, Singapore Prime Minister Lee Hsien Loong said the
city-state was keen to buy electricity from Malaysia if the terms are
right.

Lee said Singapore was in the process of working out a
framework to manage the import of electricity and Malaysian companies
were welcome to bid to supply electricity.

Prime Minister Datuk Seri Najib Tun Razak said that the sale of electricity would be a private sector initiative. -- BERNAMA